Much is gained with a little perspective.

For example, we have heard about dairy exports from the U.S. achieving a new record for multiple years now. When records are continually surpassed, it can be harder to appreciate just how remarkable they were. It’s impressive to take a step back and recognize that in 2021, overseas dairy sales totaled a massive $7.75 billion — and yet, that number still climbed to $9.5 billion last year!

Perspective might also make us ask why billions of dollars of products shipped to other countries matters to our industry right here at home. That is a question answered by market balance, product value, jobs, demand, and opportunity.

“Your farm might not be exporting, but every little bit helps,” said Pennsylvania Department of Agriculture agricultural trade specialist Kristina Watson at the Pennsylvania Dairy Summit Innovation Forum. One way to describe exports is as a method to make room for more product on the domestic market, she explained. Tony Rice echoed the balancing effect of world markets, noting there is not much domestic demand for something like non-fat dry milk, but global customers can boost the value of these products.

Overseas demand also affects what dairy products U.S. processors make, continued Rice, the U.S. Dairy Export Council’s manager of trade policy. This is important to American dairy farmers since they are paid depending on their milk’s end-product use. “We’re not just exporting commodities,” stated Rice, who is also a trade policy manager with the National Milk Producers Federation. Moving value-added product such as cheese makes a difference in U.S. milk checks.

For an off-farm perspective, attendees of the Innovation Forum heard from Dominic O’Brien, senior marketing manager for the Port of Philadelphia. The port handles more refrigerated cargo than many other locations and is the ninth-largest port for dairy on the East Coast, he said. Even during the pandemic, they saw a rise in the number of containers going through their waters. “We think of ourselves as a Pennsylvania economic engine,” he described, noting that more trade means they employ more people in well-paying jobs across the facility.

When dairy products are sold to customers outside our borders, American farmers benefit from all of this economic activity. It is rooted in the fact that people all around the world are ready for and demanding more dairy. Rice noted that dairy is making up a rising portion of the global population’s protein consumption, driven by an expanding middle class and the fact that 95% of the world’s customers live outside of the U.S. Our dairy industry can help meet that need, and exports are how our products get to those who desire them.

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(c) Hoard's Dairyman Intel 2023
February 23, 2023
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